State Lawmakers Tentatively Approve Bill Ending Privilege Taxes

May 28, 2014

Credit Dave DeWitt / WUNC

State lawmakers in the Senate have tentatively approved a far-ranging tax bill that would end the ability of municipalities to levy special taxes on businesses.

The Senate version of the bill would end what's called the privilege tax. It brings in $62 million a year to municipalities across the state.

Business leaders have long complained that the taxes vary widely and are not fairly levied. Republican Senator Tommy Tucker, who's a small business owner, is in favor of the bill.

"My heating and air company who has more than 75 employees -- I don’t see the fairness in us having to pay the thousand dollar tax the same as Bank of America or Wells Fargo or any other large corporation," says Tucker.

Senate leaders say if their version of the bill becomes law, there is time in next year's long legislative session to work out another plan for municipalities.

City leaders are wary of the measure. They say it could require them to raise property taxes or cut services. The bill requires final approval from the Senate before it can move forward.